Don't miss the moment

TNK-BP invests in oil production

Russian and British shareholders of TNK-BP decided to temporarily step back from the redistribution of the company and pay attention to production issues. Yesterday in Paris, a meeting of the board of directors of TNK-BP Limited, the parent company, took place. As Vremya Novostey was told in the Russian-British consortium, it was entirely devoted to “resolving important production issues.” In particular, the board of directors approved TNK-BP's capital investments for 2008 in the amount of $4.4 billion and determined the amount of investment in new projects. Members of the board of directors also discussed the size of interim dividends for the first half of the year: according to Managing Director for Production and Technology Tim Summers, it is planned to allocate $1.9 billion, about 40% of net profit, for these purposes. This amount is slightly less than the company's net profit for the entire last year, which amounted to 49.4 billion rubles. and was entirely spent on payments to shareholders.

At the same time, in Paris they did without the company's president, Robert Dudley , who, according to the agreements reached at the beginning of the month, will leave his post on December 1.

According to TNK-BP, the first meeting of the company's board of directors since the signing of the memorandum of understanding between BP and the Alfa/Access/Renova (AAR) consortium took place yesterday. As stated in its official statement, “the Board of Directors of TNK-BP made decisions on urgent issues of the calendar year 2008, and also agreed on positions on the growth of production, reserves, profitability and value of the company in the future.”

According to the business plan approved yesterday, TNK-BP's capital investments this year will amount to $4.4 billion, although previously this amount did not suit the company's Russian shareholders. They insisted that the $3.5 billion limit had not been exceeded, despite Mr Dudley's position. “We cannot say that the British shareholders won this dispute - this was a joint decision,” says Troika Dialog analyst Valery Nesterov. -- At this stage, investments in Russia can be very effective. As you know, the government is now reducing tax benefits, expecting an increase in production in return. To increase it, additional investments are needed. It should be taken into account that the results will appear not in two or three months, but later, around 2010.”

This year, as TNK-BP explained, for the first time additional allocations in the amount of $2.5 billion are being allocated for the development of the Uvat group of fields, Verkhnechonskoye and Kamennoye fields. The company calls this amount “a significant investment in the future growth of production and reserves of both TNK-BP and Russia as a whole.” “Costs are required to develop both old fields and new ones, for example, such promising ones as Verkhnechonskoye,” believes Mr. Nesterov. According to the company, engineering and design work, as well as infrastructure development work, will be carried out at the Verkhnechonskoye field, which will be commissioned next month and will become one of the components of the Eastern Siberia-Pacific Ocean pipeline project.

In addition, this year TNK-BP plans to increase oil production by 2%, to 82 million tons. At the same time, as experts note, the country's largest oil companies - Rosneft and LUKOIL - plan to produce 110 and 91 million tons this year, respectively. Thus, Rosneft expects growth of 8% compared to last year, and LUKOIL expects a decline of approximately 5%.

The solutions achieved, according to TNK-BP, should have a positive impact on its bottom line. “The decisions made at the meeting of the board of directors will help TNK-BP finish the year with high production results and create the preconditions for the continuation of the company’s successful activities,” TNK-BP said.

Kirill MELNIKOV